For the last 30 years, Culture has been one of the main reasons for M&A deal failure. Guidehouse experts have sought to understand the M&A integration culture challenge and, in the process, have met with countless professionals and dealmakers from across the industry, read numerous academic papers on culture and incorporated deep experience leading M&A integration efforts for clients. Through this effort, Guidehouse experts encountered many different definitions of culture. These myriad definitions and personal interpretations at best caused confusion amongst executives and, at worst, made it seem as if executives were speaking different languages. Guidehouse's response was to make culture measurable. Through primary and secondary research, Guidehouse identified 21 measurable dimensions of culture that can be used as a tool to help effectively merge cultures and realize synergies.
Guidehouse's 21 Dimensions of Culture have been grouped into 6 categories - Client Focus, Management, People, Operations, Style and Shared Values.
eMarketing / Client Service: High touch, self-service, direct, media, sponsorships
Celebrations & Events: Celebration activities, types of events, timing
Diversity & Inclusion: Organizational diversity and commitment to inclusion
Values: Clients, shareholders, people, quality
Rules & Policies: Governance, command and control, consequences and enforcement, maturity, autonomy
What does this mean for your business?
Culture is a critical component of any M&A integration effort. Using the 21 Dimensions of Culture can help your firm establish a standard, firmwide definition of culture. Additionally, the 21 Dimensions can be used as a tool to pinpoint the differences between the acquiring firm and target firms' cultures and can serve as the launching point for developing a cultural integration roadmap. In this way, the 21 Dimensions can help your firm identify, adapt, and evolve in response to cultural challenges.
Note: Descriptions of 21 Dimensions of Culture above are intended to be representative and are not fully exhaustive.
Special thanks to Jason Mraz for contributing to this article.